Thursday, December 28, 2006

Income Tax Flim-Flam

For those who are interested in the flim-flammery of the so-called "tax protester" movement, i.e., that collection of con men who tell the gullible that the government never passed a tax on wages and therefore they can escape the tax with impunity, I recommend a July 31 New York Times story, "Facts Refute Filmmaker's Assertions," found here ($$).

A few tastes:
Not mentioned in the film is that Mr. [Aaron] Russo has more than $2 million of tax liens filed against him by the Internal Revenue Service, California and New York for unpaid federal and state taxes. Mr. Russo declined to discuss the liens, saying they were not relevant to his film....

Near the film's beginning Mr. Russo says, and others appear on screen asserting, that the Internal Revenue Service has refused every request to show any law making Americans liable for an income tax on their wages.

Yet among those thanked in the credits for their help in making the film is Anthony Burke, an I.R.S. spokesman. Mr. Burke said that when Mr. Russo called him asking what law required the payment of income taxes on wages, he sent Mr. Russo a link to documents, including Title 26 of the United States Code, citing the specific sections that require income taxes be paid on wages. Title 26 says on its face that it is law enacted by Congress, but Mr. Russo denied this fact....

One tax protester featured in the film, Irwin Schiff of Las Vegas, is now serving his third prison sentence after being convicted of tax evasion crimes. Mr. Schiff introduced into his criminal case the notes of his psychiatrist, who wrote that Mr. Schiff was a successful tax shelter salesman until a con artist ripped him and his clients off. The psychiatrist concluded that Mr. Schiff became delusional, believing he alone could properly interpret the tax code, as a way to avoid acknowledging reality.

Later, one of Mr. Schiff's confederates, who was also later convicted and sent to prison, sent e-mail messages to supporters saying that the psychiatrist's notes were introduced as part of a ruse to help Mr. Schiff escape prosecution.

11 comments:

  1. On a somewhat related topic, are you aware if anyone has invoked Amendment V, to argue against paying real estate taxes, particularly those assessed to pay for public (government) schools? That is, "No person ... shall be deprived of ... property, without due process of law; nor shall private property be taken for public use without just compensation." I realize the last part is seen as eminent domain protection, but if someone doesn't have school-age children, isn't a real estate tax for a public school budget, "taking property for public use without just compensation"?

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  2. With property taxes, I don't know if anyone has tried it. I'm sure it would not work. The Fifth Amendment has not persuaded the Supreme Court with regard to the income tax.

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  3. The film is about the growing police state in America. Including in this, Aaron Russo can't find one person who can show him in the statutes where an average person is required to file a return and pay an income tax. Russo's tax liens (if so) are not relevant to the question Russo raised.

    As for Anthony Burke, all he has (in the NYT) is Title 26. Title 26 is also called the entire Internal Revenue Code; i.e, tens of thousands, or hundreds of thousands (I don't know, but it's a whole lot) of pages full of "legalese". If the NYT have something specific, why did the NYT show it? It's like a cop pulls me over and writes me a ticket. When I ask what law am I violating, he shows me the vehicle code (?!). The Supreme Court decision, Gould V. Gould (1917), and common sense, requires the government to show the specifics.

    I made a mistake earlier: there is one answer to Russo's question. In the film, when ask, Rep. Ron Paul (you know how honest and sincere he is) finally admits, "I can't site a law; no, I cannot."

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  4. It's a great myth, or misunderstanding, that there's no law on the books or that the IRS won't cite it. Go to the IRS site and type "tax code" into the search box. Voila! It's all there (unfortunately). There's even a table of contents. And those are not just regs. Congress enacted it as part of the US Code. I found it on Google in 20 seconds.

    Or ask a CPA or tax attorney. There is no mystery here, folks.

    I can't tell you why Ron Paul or anyone else doesn't know this. But that has no legal implications whatsoever.

    Russo is wrong, and he harms libertarianism by making such transparently shoddy arguments.

    Research this for yourself and you'll find this is the weirdest quackery you have ever encountered. I can't imagine why people delude themselves this way.

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  5. If you're still not convinced there's a law (and I know that some tax-protesters will never be convinced), see this this page.

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  6. I notice that after you actually pointed out the specific laws, Mr. Bell seemed to disappear.

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  7. I am absolutely amazed at the ignorance of Sheldon Richmond. Title 26 does not contain nor can anyone cite a specific law. He cites the entire tax code as the law yet the only people that are mentioned specifically as having a legal duty to pay a tax are judges, members of congress and the manufacturers of alcohol, tobacco or firearms. It is extremely unfortunate that these people write such untruths because they really don't know that they are punishing themselves for that false belief. I have the IRS running from me now and they are more afraid of me than they are of the truth. Cowards.

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  8. Tax protestors inevitably end up hiding, in jail, or dead with the debts left to their children - and all because they fall under the spell of some self-proclaimed "genius" (who themselves is likely in jail, in hiding, or has been disbarred for being incompetent.

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  9. The "law" that Sheldon cites states "taxable income" is subject to income taxes. I have no taxable income so that certainly does not apply to me. By the way, please tell me what "voluntary compliance" means? That is how the IRS explains what the requirement to file is based on. Are you kidding me? If something is voluntary why does anyone HAVE to comply? Why isn't it "mandatory" compliance if EVERYONE needs to comply? Government officials must file and pay but then it was there choice to be government employees...morons.

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  10. Weird quackery is right.
    The protesters are just selfish.
    "MY money! You can't have MY money!
    Waaaaaaaaaah......"

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  11. They are right, it is their money.

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